Answer:
a.In normal costing, actual overhead costs always enter the work-in-process account
Explanation:
As we use an applied overhead rate this will most probably be diferent than actual overhead as it is calculated based on expected overhead cost and expected cost driver amount.
Therefore, difference will arise and there will be under or overapplication of facotry overhead.
If your organization hires all of its functions except the company name and coordination of contractors, it is a virtual organization.
<h3 /><h3>What is a virtual organization?</h3>
It corresponds to an organizational structure that works in the form of alliances that come together for a specific purpose, usually to start a project faster and with shared responsibilities, such alliances being dissolved at the end of the joint project.
Therefore, in a virtual organization, there are separate business units according to the business objectives and goals.
Find out more about organizational structure here:
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Answer:
2. Cost-variable.
Explanation:
Variable costs basically depends on the customers in the shop. In this case, the more napkin a person uses, the more Java Joe has to order.
Answer:
Both A and B are true.
- A. All else held constant, if a company has a beta of 1.2, then the cost of equity for this company will increase if the risk-free rate decreases.
- B. If you assume a company has debt, then an increase in the tax rate will decrease the weighted average cost of capital for the company.
Explanation:
A)
The formula to calculate the cost of equity is:
cost of equity = risk free rate of return + [Beta × (market rate of return – risk free rate of return)]
e.g. market rate 15%, risk free rate 5%:
cost of equity = 5% + [1.2 x (15% - 5%)] = 5% + 12% = 17%
if the risk free rate decreases to 3%:
cost of equity = 3% + [1.2 x (15% - 3%)] = 3% + 14.4% = 17.4%
B)
the WACC formula = (cost of equity x weight of equity) + [cost of debt x weight of debt x (1- tax rate)]
if the tax rate increases, then the WACC will decrease because (1 - tax rate) will be lower.